>> i am john, welcome to bloomberg markets. >> i am a matt miller. after drops on every other trading day of the shortened week, we are looking at a little bit of a bounce. the s&p 500 gaining .2%. we are looking at the 10 year yield up 1.5 basis points. a little bit of weakness once again for the bloomberg dollar index. we have been seeing real gains. we are close to the year high, 1257. i think the all-time high is 1353. crude bouncing back, $87.56.

jon: what a hot streak recently for energy. energy stocks have done well. tech has done well, as well. tech has taken a hit over the last few days but you see microsoft bouncing back. one of the best performers, up 1.5%. we see kroger shares up 4% as that company tries to get an antitrust thumbs up to that albertsons deal. that is some of the stock market story. i have to come back to the economy map because we have been watching the jobs story. we got the weekly numbers one week after the u.s. numbers. very strong numbers versus expectations. 40,000 jobs created versus an estimate of 20,000. you are continuing to see wage growth accelerate.

that is coming at a time when we saw the bank of canada pause on interest rate hikes this week. some people wondered after a weak second quarter if the bank of canada would be done with rate hikes. the fed is navigating an economy with the inflation story going forward. matt: very interesting economic data. the central bank moves reaction or lack thereof. . there is a pause in rate hikes. fed officials are increasingly optimistic they can contained inflation without causing serious economic pain. let's bring in bloomberg economics and policy reporter michael mckee. what did they call this? immaculate disinflation? michael: it is not completely immaculate. we had unemployment go up by .3%.

matt: because more people are coming into the labor market. michael: inflation coming down and unemployment still low and growth still high. atlanta fed gdp comes up with an update, 5.6%. goldman sachs is saying 3.1%. matt: i want to jump in, jon. the atlanta fed gdp forecasts, i have heard from others they have some errors in their model that makes her stronger at the getting of a quarter. michael: it is the fact they only have a small slice of the quarter to put into the model. we have only been dealing with july numbers and we are in september. once the august numbers start coming in you will see it come down. jon: just going back to your conversation this week with john

williams, the messaging from here will be very interesting from central banks, whether it is here in canada or the head of the new york fed. the idea of monetary policy being in the right place. how are we supposed to interpret what that means going forward? michael: i think they want some confusion, jon. they are telling people they are in restrictive territory but they do not know how restrictive. they will watch the data and decide if any to go another 25 basis points. the ambiguity they are leaving is deliberate. they do not want the markets to think they are done and then start pricing in cuts. the bank of canada found out when you have to go back in that you surprised the markets and that does not work out well. they are trying to hint at what they are going to do without committing to anything. they seem to be a little ambiguous in what they are saying. jon: the fact that we know what

they will do before they do it, does that make a monetary policy transmission a shorter lag than the 18 months to two years that is talked about? michael: i do not think at this .25 basis points will be a big difference in terms of getting in there faster. the fed started talking about thinking about raising rates. there is an argument that they do anticipate and it gets into the system but when you look at home sales and auto sales, we have not seen as much movement although the other rate sensitive sectors -- the other side of the argument is it is still out there and will still take time when you get around to borrowing money to buy something big, then you will really feel it. jon: we were looking at a chart on some of that inflation

progress and we have this cpi report to watch heading into next week. what do you think the market will be looking for in the latest price data? michael: the forecast is for a small rise in the overlying -- overall headline cpi because of energy and the focus will be on the core. that is expected to fall. the markets will think we are on the right track and they will not price anything significant in what if core does not come down, look for markets to reprice to a november move or a september move. it would depend on how much this cpi was off. they want to leave open the possibility of november. that is where you could see the action would beget the cpi report. jon: the eagles playing tonight. are you going to the eagles? michael: i am not, unfortunately. i was watching football last night and that seems to be enough. jon: michael mckee, our economic

and politics editor. matt: coming up, blue owl's marc lipschultz joins us. this is bloomberg. ♪ ♪ is it possible to fall in love with your home... ...before you even step inside? ♪ discover the magnolia home james hardie collection. available now in siding colors, styles and textures. curated by joanna gaines. and your store was also the first time you realized... well, we can do anything.

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you don't have to worry about things like changing tax rates or filing returns. avalarahhh ahhh >> this is bloomberg markets. i am jon erlichman with matt miller. we have been tracking shares of blue owl capital. it has been moving toward private credit with a group of

private players and handling a growing slice of the fixed income market. in blue owl's case, the company is setting in size on even bigger loan packages. matt: the possibility we could get a $10 billion loan out of private credit as there is so much dry powder. this is becoming an entrenched industry. let's bring in luau will co-ceo. let me first ask you about the incredible growth of private credit and the amount, it has taken away from the traditional wall street banking system. do you think we stay on this trajectory? marc: thank you for having me. it is a pleasure to be here on bloomberg. what we see is a product meeting a need. the financial markets in the u.s. has been a tremendous

strength in terms of our economy and where we are today and growth. private credit is meeting a need , providing long-term debt capital for people who want to make long-term financing decisions. it is decisions that are fundamentally based. what we focus on is credit. where will we be when the loan comes due? it is a structure -- i suppose like any new, innovative product for lack of a better term -- you find a need in the market and meet it, it is a real opportunity. sonali: the banks are salvaging over the idea of the markets coming back, a lot of private credit deals were done when the markets were closed. even as they open up, about $10 billion worth of deals were shifted into credit, how do you think the tension will play out in the next few weeks? marc: to have a healthy economy and marketplace, we need both. we need a functional, syndicated

market, liquid capital markets, and we need a functional private credit market. sonali: there is less deal flow for you because of the outlet? marc: mathematically speaking, if financing could go to the public market or private market, each individual transaction could have gone to one or the other. in aggregate, we are talking about a multi trillion dollar market. we are very small when stacked up against this multi trillion dollar requirement. i think a lot of time, there is too much focus on banks versus private credit. we are making fundamentally different decisions. taken together, that is how you have a functional marketplace. jon: let's talk about the investor connection. there has been such a deep conversation among investors worrying about private credit opportunities as well.

how does that fuel what you think about doing? are the deals in part coming together because the investor appetite has been growing? marc: the investor appetite reflects the same adoption, this realization that by viewing a senior secure private lender, we can deliver an attractive risk-reward. consider today would we make a loan to a really high quality, large cap software company with an a+ sponsor, we are able to make up 12% return making that loan and that passes through to our investors. the idea you can be senior in the capital structure -- in a world where the rate trajectory is uncertain, we are insulated, investors are insulated to that. senior floating rates and death the end of the day producing an attractive return. sonali: this is from a viewer

right now. how when the world are these portfolio companies managing the floating rates of loans in a market where you are seeing margin pressure? where are things starting to break? jon: i had the same question. matt: how are you insulated from that when portfolio companies are paying 4%, 5% interest and now they are looking at 7%, 8%, 9%? marc: sophisticated sponsors with well underwritten capital structures. i am not suggesting this is true for all. parts of private credit. blue owl from inception we have focused on financing the largest companies with the best backers and durable, insulated businesses. at the end of the day what we want to do is low volatility and hyper-dicta ability. sonali: is there renegotiation going on behind the scenes? marc: the idea of the mechanics of floating rate are built into

the agreement and any sophisticated private equity investors. i did private equity for over 20 years before cofounding blue owl. we spent a lot of time on different case scenarios. it certainly would include and contemplate higher rates. i hope people are contemplating rates higher than zero. there are certainly people who did not fully contemplate the rate differences. the sponsors we are lucky enough to work with are absolutely contemplating -- various passive interest rates. are t renegotiationshere that go on? we are making a long-term investment as a lender. they are making a long-term commitment to us as our partner. a typical transaction, we land

40% of the loan, the value of an enterprise, we are partners in the long-term. as a result, when things change -- things do change, we prefer better than worse -- we get together in a room and say, where are we? where are we going? that is the value to the proposition of the user of the capital. we can give them predictability, privacy and partnership. matt: that is huge. jon: what about if more firms are watching what you are doing and getting interested in that and want to come into the sector and we have a broader conversation around the underwriting approach. obviously you are focused on some pretty established businesses with a long track record. is there a risk that if there is not a common voice on that that you could see some -- being

taken in the sector that would not play out as hope? marc: within the broader private credit, i am sure you will see people succeed and fail and there will be people who will pursue returns, chase yield and take too much risk. it has been done before in private credit and investing in general. our model is focused on the lowest risk, low volatility part of this marketplace and that is where we will stay. we have looked at 8000 different credits to make the loans we have. we have lent $75 million. over that >> time, our loss rate has been six basis points per year. sonali: there is this report out from our own bloomberg intelligence this week that says private credit can be a $22 billion opportunity and that implies private credit taking 10% of the $37 trillion fixed

income market. is the 10% the right number two think about? more or less? marc: i do not have a view on the exact number but you have noted something really interesting. even taken into the extent, we are still talking about 90% of the market being somewhere else and this is back to my earlier point -- you need both markets. we are not rooting against liquid markets, they are important, but i think our proposition is growing. through every disruption, you set a new level that private credit achieves because you get more users that come to appreciate the value and more investors that say i should have this in my portfolio. i am making a double-digit return to be a senior lender with inflation protection. matt: it is incredibly hot, right? sonali wrote a story about blue

owl today. frequent has said private credit has billions in dry powder globally. you came from private equity where they have multi trillion dollar numbers. why does and that multi trillion dollar number apply to private credit? people in private equity are also in private credit. marc: you are hitting on the supply and demand equation. $443 billion does include all types of private credit indirect lending, which is where we focus and what i have been describing in terms of risk-reward. that is a much smaller slice but still a large piece. in some regard, the notion there is a multi trillion dollar private credit opportunity is probably true. i am not expecting that is where we are heading in any foreseeable period of time but

you are right to point out that private equity does give you some sense of the future potential of private credit. that is our customer base. matt: you guys will probably be going to super return, right? marc: absolutely. [laughter] matt: great to spend some time with you. thank you for coming in. sonali, always a pleasure to have you. blue owl co-ceo marc lipschultz and bloomberg reporter sonali basak. jon: we will be getting a lot of wall street at the movie theater, coming up soon. remember the gamestop frenzy? it is coming to hollywood -- coming from hollywood to the big screen. a new film called "dumb money." we will learn more about it, next. ♪

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>> the meme trading frenzy and gamestop took wall street by storm. that story is now getting the hollywood treatment in a new film called "dumb money," premiering at toronto's film festival. we spoke with executive producers. >> economic inequality, we have seen the top 10% has added $29 trillion to their wealth over the last 30 years. this movie is a way into some of the most -- inequalities of our time. it was important to us, especially being part of the writers guild that is fighting for transparency and fairness in hollywood. jon: let's talk to somebody who knows the meme stock craze very

well. does this surprise you to see a hollywood film around this storyline that everyone is talking about? bailey: not at all. i remember when gamestop was going crazy. a number of articles calling out tv series and it led to conversations about who they would cast. i will be interested to see how people react to the casting of a number of infamous or more famous people who were related to that frenzy. matt: famously trading from the basement in a headband. is he still loaded? he made a ton of money, did he keep it? bailey: i don't know. i remember getting a press release that a lot of his call options -- he was continuing to hold the stock with some of those u.s. regulators with the

notion that he would continue -- i have to imagine he is still quite rich relative to many of the people who bought in at the top and is benefiting from where gamestop still is relative to where it was in 2020. matt: i was just googling when the movie comes out here. i definitely want to see it. any seth rogen picture is good for me. i think it will be a pretty cool set up. jon, i am sure you will see it, as well. are you going to the premiere tonight in toronto? jon: it is a hot ticket when you do not have a lot of stars right now. i will see it at some point. we take a look at what we are seeing in the markets right now. a bit of softness heading into the weekend. the s&p up .2%. for matt miller, i am jon erlichman, this is bloomberg. ♪

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>> the dollar's rally loses steam. live from studio 2, item scarlet fu. >> i am -- i am scarlet fu. >> i am katie greifeld. seeing some support when it comes to u.s. equities. big tech even more so. the nasdaq 100 is currently higher by .4%. a quiet day in the bond market. take a look at 10 year treasury yields, they are up one basis point, 4.25%. crude oil, this has been one of the big stories of the week. this continued rise in crude oil, currently trading at just below